The Netherlands wants to scrap mandatory gas storage targets under a revamp of the European Union’s energy supply security rules after spending nearly EUR 1 billion ($1.1 billion) this year to fill the country’s reserves.
The current EU regulation requires member states to fill storage sites to fixed levels ahead of winter through 2027, with obligations based largely on storage capacity rather than domestic gas consumption. That leaves the Netherlands, which has a relatively large storage system but shrinking demand, with an outsized filling requirement.
The European Commission, the bloc’s executive arm, isn’t planning to extend the mandatory targets beyond the current timeline, according to a draft document seen by Bloomberg News. Instead, it wants to merge some existing laws and create a broader security of supply framework for both gas and electricity. The current gas regulation that includes storage targets would be dropped in the overhaul, which is due to be unveiled later this year.
That would be in line with the demands of the Dutch government, which argues that the current EU system forces governments to do a job that the market should be doing. The rules also increasingly clash with market economics. Falling consumption and “large-scale purchases by other European governments” have skewed the economics of storing gas, Climate Minister Stientje van Veldhoven said in a letter to parliament Friday.
Gas stockpiling has been particularly difficult this year throughout Europe because the Middle East conflict has driven up near-term prices relative to winter contracts, making summer injections unprofitable. European gas contracts have more than doubled since the start of the war reaching their highest level since late 2022 earlier this month.
The result is that the Dutch government has increasingly had to subsidize storage filling to meet its EU obligations. This filling season alone, it committed close to €1 billion to ensure reserves were replenished.
Europe’s storage facilities are currently 70 percent full, below the seasonal norm of 86 percent. The situation is even more acute in the Netherlands, where the sites are just over 56 percent full.
To increase gas supply security, the commission plans to set standards for companies in specific supply disruption scenarios, according to the draft. National governments would introduce regulations to ensure gas companies comply with such standards, with a possibility to impose fines.
The revamped EU regulation, due to be proposed in the autumn, will need approval from the European Parliament and from member states in the EU Council to become binding. Each institution has the right to propose their own amendments in the legislative process, which typically takes at least a year.
The Dutch demands for the EU new security of supply system include the possibility that suppliers serving protected customers, such as households, would be required to hold some of the gas needed to meet their obligations in storage, Van Veldhoven said.
The Netherlands argues the current system also fails to account for its role as a regional gas hub. Its storage sites help provide security of supply to neighboring countries, yet the government cannot charge other EU member states for the cost of ensuring those facilities are filled.
The Dutch have already lowered their stockpiling target to ease upward pressure on wholesale prices, following a call by the Commission amid ongoing fighting in the Middle East.
The government is also considering a much bigger strategic gas reserve as a backstop against severe supply disruptions. The Netherlands currently holds national reserves equivalent to about 5 terawatt-hours, but officials are studying options that could increase the buffer to as much as 72 terawatt-hours.
Unlike commercial inventories, that gas would be reserved strictly for emergencies and could not be released simply to influence market prices, similar to the rules governing strategic oil stocks.
The Netherlands is a relatively small gas consumer but remains a major European trading hub and is home to the region’s benchmark gas price.
